We see analyst upgrades and downgrades all the time, commonly coming paired with updated price targets. They can be helpful tools for investors, providing a more structured plan and helping to inject positivity surrounding future performance.
Of course, stocks don’t reach price targets in a straightforward manner, as unforeseen circumstances can always influence performance. Overall, the shift in sentiment can be seen as a primary takeaway from these upgrades.
Recently, several market heavyweights, including NVIDIA NVDA, Adobe ADBE, and Amazon AMZN, have all seen price target upgrades. All three stocks have already helped lead the market’s rebound in 2023 so far, delivering outsized gains to investors. Let’s take a closer look at each.
Amazon
PhillipCapital raised its price target on AMZN shares from $120 to $175 per share, citing efficiency enhancements. The stock is currently a Zacks Rank #1 (Strong Buy), with earnings expectations shooting higher across the board following robust quarterly results in its latest release.
The strong quarterly print was partly driven by continued consumer resilience, with the company having its biggest-ever Prime Day in July. As shown below, the market reacted strongly to the results, seeing plenty of buying pressure post-earnings.
And the company’s growth expectations are hard to ignore, with Zacks Consensus Estimates suggesting a 200% improvement in earnings year-over-year on 11% higher sales in its current year. The growth is slated to continue into FY24, with earnings and revenue forecasted to climb 34% and 13%, respectively.
Adobe
Bank of America upgraded Adobe shares to Buy, raising its price target from $575 to $630 per share due to its artificial intelligence (AI) standing. The company has seen modest earnings estimate revisions across all timeframes.
Keep an eye out for the company’s upcoming quarterly release expected on September 14th; the Zacks Consensus EPS Estimate suggests a 16% improvement in earnings, whereas revenue is forecasted to grow 10% from the year-ago period.
Adobe shares trade at a high multiple, typical of high-flying technology stocks. Still, the current 32.8X forward earnings multiple (F1) is well beneath the 44.1X five-year median and highs of 36.0X in 2022. The company is forecasted to witness 15% earnings growth on 10% higher sales in its current year.
NVIDIA
NVIDIA has been the most popular stock in 2023, and its robust artificial intelligence (AI) operations are precisely why. Rosenblatt Securities raised its price target from $600 to $800 per share, reflecting roughly 85% upside from current levels.
The stock sports a Zacks Rank #1 (Strong Buy), with expectations rising across the board following the company’s last blowout quarter in May.
NVIDIA sports some serious growth projections, with Zacks Consensus Estimates suggesting 130% higher earnings in its current year on 60% higher revenues. Peeking ahead to FY25, expectations suggest a further 40% bottom line growth paired with a 35% sales increase.
And many are expecting another blowout release when the company reports on August 23rd, with the Zacks Consensus EPS Estimate of $2.06 more than 80% higher since mid-May. Sales revisions have also hit the tape following its recent guidance upgrade, with the $11.0 billion estimate up 14% during the same period.
NVIDIA shares have been boosted by quarterly results throughout 2023.
Bottom Line
Price targets can be helpful tools, providing investors with a more structured plan. Of course, not all reach these forecasted levels, as unforeseen circumstances can always affect the future.
Still, the positivity surrounding upgrades can be seen as a solid takeaway.
All three heavyweights above – NVIDIA NVDA, Adobe ADBE, and Amazon AMZN – have seen recent price target upgrades among analysts.
Amazon.com, Inc. (AMZN): Free Stock Analysis Report
NVIDIA Corporation (NVDA): Free Stock Analysis Report
Adobe Inc. (ADBE): Free Stock Analysis Report
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